Canadian Forex Midday: C$ Lower

Winnipeg, December 21 – The Canadian dollar was trading at a lower level versus its US counterpart at midday Friday, as soft Canadian inflation data weighed on its value, analysts said.

Statistics Canada reported inflation in November was up 0.8%, a three-year low. The figure was also below expectations of a 1.1% increase.

At 11:54 CST Friday, the Canadian dollar was trading at US$1.0072, or US$1=C$0.9929, which compares with Thursday’s North American close of US$1.0129, or US$=C$0.9873.

Declines seen in crude oil prices were also behind some of the Canadian dollar’s weakness.

Concerns about the impending US ‘fiscal cliff’, as there is still no solid solution to avoid tax hikes that would effect on January 1, had traders avoiding riskier assets, including the Canadian currency.

Canadian gross domestic product data had little impact on the loonie, as it fell in line with pre-report expectations. StatsCan reported GDP was up 0.1% in October.

The Toronto Stock Exchange was up 0.47 points, or 0.00%, at 11:54 CST Friday, to sit at 12,389.18.